Medforce Blog

Best Practices for Healthcare Denial Management

September 05, 2017

Category: General

Denials in healthcare operations create financial bottlenecks – not to mention the frustration of do-overs and hassles with the organizations generating the denial. Best practices for healthcare denial management, however, can help you eliminate these bottlenecks and make your systems more efficient and your staff happier. Some basic quality improvement techniques and the right software systems can help.

Processes Drive Performance

A slipshod process, or one your staff bypass, is often the origin of problems with healthcare denial management. A root-cause analysis can identify exactly why your denial management processes are problematic. For example – what's your organization's percentage of coding errors? Is there an imbalance in employee performance? How much time are people spending on handling appeals and determinations? If you don't have the answers to questions like these, there's no way to identify the primary source(s) of your denials and put new processes in place.

Jump Through All the Hoops

Denials often happen because of missing information. A denial due to lack of medical necessity often results because someone didn't enter all the tests or procedures or didn't capture the right diagnosis or procedure code. You need a system with safeguards that will put up an alert or not allow you to move ahead until you have a clean claim. Timing matters; plan appropriately so you aren't picking up a claim with a one-day deadline that will take two days or work. Remember, you have no control over physicians and patients who have information you need - allow for some back and forth communications. When you're managing healthcare denials, you can't operate on the old adage, “forgiveness is easier to get than permission.”

It's The People

Processes and procedures are all very well, but in the final analysis, it's your people who will solve your healthcare denial management problems. Uneven employee performance can create problems. A formal training program, whether internal or external, with periodic testing to see whether people have maintained their skills, will more than pay for itself. Don't use the “telephone game” method where the final message is so distorted it's incomprehensible. You must also consider whether you've matched the level of work to the employee's skill level. More complex issues need a high level of expertise (and yes, higher pay as well).

Working The Denials

When you have to appeal, take advantage of tools that allow you to sort and see all the outstanding AR items for that payer. If a payer limits claims per call, make sure you max out each call. Always follow the specific instructions to appeal denials at a given payer organization. Payer organizations also generate material on a regular basis. A point person should be assigned to monitor all the correspondence, bulletins, instructions and other communications, especially from your high-volume payers. When changes occur, make sure your providers and other staff are brought up to date.

The Right Software

One of the more important aspects of denial management, according to Becker's Hospital Review, is to collect, track and trend data on your denials process. In order to achieve that goal, you need a software system that can import ERNs, provide the information to identify denial trends and give you reports that allow you to analyze denials on the basis of detail and summary reports. Since people are so important to the process, you also need the software to monitor, track and compare your employees' performance and effectiveness.

Solving healthcare denial management problems isn't easy. However, it is well worth the effort. Once you have the data, you can streamline your administrative and billing processes to solve your denial problems.

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